How Telematics Programs Work and What They Track

A telematics program, also called usage-based insurance, is a car insurance option where the insurer records how, when and how much you drive and uses that record as one of the inputs to your price. The National Association of Insurance Commissioners (NAIC) describes it as insurance that tracks mileage and driving behavior, with premiums set according to how the driver actually drives ¹.

The short answer to "what do they track" is: miles, time of day, location and a handful of driving events such as hard braking. The longer answer depends on the insurer, the device and the state, and the result can move a price in either direction.

Regulators list a fairly consistent set of data points. The NAIC names miles driven, time of day, location via GPS, rapid acceleration, hard braking, hard cornering and airbag deployment ¹. The Washington State Office of the Insurance Commissioner gives nearly the same list: where you drive, the number of miles, time of day, rapid acceleration, rapid braking, hard cornering and airbag deployment ².

Some programs add phone use. One insurer program page, for example, says it considers phone use only in some states and only when the driver uses its mobile app ³. How much data is collected depends on the technology used and on how much personal data the policyholder agrees to share, according to the NAIC ¹.

There are three common ways a program gathers data ¹:

• A mobile app on the driver's phone, which uses the phone's sensors and location.
• A plug-in device the driver installs in the car.
• Equipment built into the car by the manufacturer.

Washington's regulator notes that insurers may use either a mobile app or a dedicated device in the vehicle ². Programs may differ on how long they monitor and when the result is applied. One program page, for example, says its discount is credited at renewal, usually after six months, once enough driving data has been collected ³. The program terms say how long monitoring lasts.

Telematics data is not the whole price. Washington's regulator says insurers combine the driving data with traditional rating factors such as the car, the address and the driving record ². In general, short trips at low speed during the day are treated as lower risk than long trips at night with aggressive acceleration or cornering ².

The key point many drivers miss is that the price can go up. Washington's regulator says premiums "may go up or down depending on your driving behavior," and that not every driver will meet the insurer's standard for a discount ². Programs differ here, and the terms vary by state.

As one concrete example, Progressive's Snapshot program page states that "your rate could increase with high-risk driving" and that "only about 2 out of 10 drivers actually get an increase" ³. The same page lists a $164 average discount at sign-up, which it says expires at renewal, and a $328 average discount at program completion, as averages for drivers who save ³. Those are the company's own figures for its own customers, not a forecast for any one driver. We are not affiliated with the insurers named, and we describe the program here only as an example of how such terms are written.

A Colorado consumer guide adds that insurers usually give drivers a small discount just for agreeing to take part ⁵. That sign-up credit and the discount earned from the driving data are often two different things, which matters at renewal: see why a discount can disappear at renewal.

Telematics pricing is still insurance pricing, so state rules apply. The NAIC notes that many states require insurers to get approval for new rating plans and that rate filings usually need statistical support ¹. It also says the details of a usage-based plan and the individual driving data are treated as proprietary to the insurer ¹. If you want to know how a filed plan works in your state, the state insurance department is the place to ask. Our explainer on what a rate filing is covers how those filings work.

The NAIC says tracking mileage and behavior has raised privacy concerns and that some states have passed laws requiring insurers to disclose their tracking practices and devices ¹. Washington's regulator suggests drivers ask themselves a few direct questions before joining ²:

• Do I trust my insurer with this information?
• Will my driving behavior help my price, and if not, would I change my habits?
• What exactly will be monitored?
• Can I decide whether the device data is used after an accident?

Data can also come from the car itself, outside any insurance program you signed up for. In January 2026 the Federal Trade Commission finalized an order against General Motors and OnStar over allegations that they collected precise geolocation and driving behavior data from vehicles without informed consent and sold it to third parties ⁴. The order requires affirmative consent before collecting or sharing connected vehicle data, lets consumers request and delete their data, and bars GM from disclosing such data to consumer reporting agencies for five years ⁴. If you are unsure whether your car shares driving data, check the vehicle's connected-services settings and privacy notice.

That depends on how you drive and how comfortable you are being measured. Drivers who cover few miles, rarely drive late at night and brake smoothly are the ones the scoring tends to favor ². Drivers with long night commutes may see little benefit or a higher price. Ask the insurer, in writing if possible, whether the program can raise the price in your state, how long monitoring lasts, and whether the discount is reviewed at each renewal.

If a renewal bill went up and you are trying to understand why, start with our guide to why car insurance goes up and how to read your renewal notice. A telematics score is one possible factor among many, alongside repair costs and changes with no accident or ticket.

• ¹ Official record: NAIC description of usage-based insurance, the data points tracked, collection methods, rating plan approval and privacy laws, checked October 11, 2026.
• ² Official record: Washington State Office of the Insurance Commissioner on what is tracked, how data combines with other rating factors, that premiums may go up or down, and questions to ask, checked October 11, 2026.
• ³ Reported: Progressive's own Snapshot program page, the source of the phone-use terms, the rate-increase statement and the $164 and $328 average discount figures, checked October 11, 2026.
• ⁴ Official record: FTC press release on the final order against General Motors and OnStar, checked October 11, 2026.
• ⁵ Official record: Colorado Division of Insurance buyer's guide (NAIC consumer guide) on the participation discount, checked October 11, 2026.